Exxon CEO Takes Umbrage At BP Chief’s Comments About DWH Explosion

In an unusual sign of discord between two top executives of major western oil producers, Exxon Mobil Corp. (XOM) Chief Executive Rex Tillerson strongly criticized statements his counterpart at BP PLC (BP) made this week about the Deepwater Horizon blowout.

Since the explosion last April aboard an offshore drilling rig killed 11 workers and triggered the worst offshore oil spill in U.S. history, many companies have tried to distance themselves from BP.

The verbal dust up between executives is a sign the tension between BP and the industry has not abated in recent months.

(This story and related background material will be available on The Wall Street Journal website, WSJ.com.)

Robert Dudley, BP’s chief executive, speaking at a conference of oil executives in Houston earlier this week, said he believed the entire industry could learn from safety lapses identified by BP in the wake of the massive explosion and offshore oil spill.

“I think it would be a mistake to dismiss our experience of the last year simply as a ‘Black Swan,’ a one-in-a-million occurrence that carries no wider application for our industry as a whole,” Mr. Dudley said.

BP’s investigation had uncovered problems and developed “we believe, lessons for the industry as a whole,” he said.

Asked about this on Wednesday at Exxon’s annual presentation to analysts, Mr. Tillerson disagreed. “I think those comments are a great disservice to this industry,” he said. “This conclusion that this is a bigger problem for the industry is just wrong.”

He went on to say that, as far as he could tell, the underlying cause of the disaster was a “breakdown of management oversight and that management oversight rests in the lap of one company [BP]… to extrapolate that to the entire industry, I think that is a real overreach.”

Mr. Tillerson has said in the past that he believes Exxon’s system of managing risk, implemented after the Exxon Valdez ran aground in Alaska, helps it avoid catastrophes.

“I think the industry manages this risk well. When you do things the proper way, these things don’t happen. This may well be a black swan event,” he said.

The National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, appointed by President Barack Obama, concluded earlier this year that BP and its contractors made “identifiable mistakes” that led to the blowout. But one of the co-chairmen said in January he had broad concerns that the entire deepwater exploration industry faced a “systemic problem.”

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